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Home / Hardware / It's Official: Dell Now Privately Owned

It's Official: Dell Is a Privately Owned Company

By Barry Levine / NewsFactor Network

PUBLISHED:

OCTOBER

29

2013

Dell Computers is now officially private, and the company's current product lineup will remain the same -- at least for now. The completed deal, made official Tuesday, sold the computer company to CEO and founder Michael Dell and investment firm Silver Lake Partners for $24.9 billion.

The deal had been approved by shareholders last month, following resistance and counter-offers by some shareholders led by financier Carl Icahn, who contended that the deal was unfair to them. The buyers are paying $13.75 per share.

CEO Dell has said that taking the company private can give management more flexibility in determining how it should move forward, as it tries to survive what some have described as this post-PC era. Since it no longer needs to answer to Wall Street, that line of thinking goes, the company will have more leeway to make the changes and long-term investments it needs.

75 Percent

Dell owns 75 percent of the company and will remain as company chairman and CEO. The company made its name in the PC market, but has suffered as the world of personal computing moves away from PCs. Gartner, for instance, has reported that demand for PCs dropped 11 percent in the second quarter, only the latest of a series of declines. In August, the company reported $14.5 billion in revenue for its second quarter, which represented a whopping 72 percent drop in net income.

The company will continue to market to both consumer and markets, which increasingly overlap on the user end. In September, Dell unveiled new laptop models while winnowing the variety it was offering, and earlier in October it launched new Venue tablets for Android and Windows 8.1.

Recently, the company said it would continue its central focus on the midmarket, and is expanding its worldwide reach of more than a dozen commercial showcases with new ones in Sao Paolo and Dubai so that customers can test-run Dell products. Dell will also attempt to reinvigorate its support, especially with customized support packages targeted at premium levels.

End-to-End Solutions

Over the long run, Dell is expected to focus more on software and services, on the order of what IBM has become. But it is not giving up its hardware business, as CEO Dell has boasted of his company's evolution into a complete solution provider, such as running all of the IT for a major hotel chain. A key asset in providing end-to-send solutions is its server business, including its new, next-generation 64-bit hyperscale server now being demonstrated.

Dell the company, the CEO has said, is no longer offering just ingredients, but complete solutions that speak to business needs. When the deal was first announced, CEO Dell issued a statement saying he was "pleased with this outcome and am energized to continue building Dell into the industry's leading provider of scalable, end-to-end technology solutions."